The ACIT,Valsad Circle, Valsad V. Shri Vijay Jagdish Chheda, Pune

ITA 1270/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9229 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 24-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 12-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PANDEY
• Assessee Lawyers: SN SOPARKARAR
• Keywords: Unexplained investment; Additional evidence

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD , , BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T.A. NO.1270/AHD/2012 ( / ASSESSMENT YEAR : 2009-10) ACIT VALSAD CIRCLE SURYAPRAKASH CHAMBERS DHARAMPUR ROAD, VALSAD / VS. SHRI VIJAY JAGDISH CHHEDA 13-BELMOUNT PARK ICS COLONY OFF.UNIVERSITY ROAD, PUNE ./ ./ PAN/GIR NO. : AADPC 4744 M ( ' / APPELLANT ) .. ( #' / RESPONDENT ) ' $ / APPELLANT BY : SHRI A.K. PANDEY, SR.DR #' % $ / RESPONDENT BY : SHRI S.N. SOPARKAR, AR &'( % ) / DATE OF HEARING 24/02/2016 *+, % ) / DATE OF PRONOUNCEMENT 04/03/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-VALSAD [CIT(A) IN SHORT] DATED 30/03/2012 PERTAINING TO ASSESSMENT YEAR (AY) 2009-10. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 2 - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW WHETHER THE LD.CIT(A) IS JUSTIFIED IN CONSIDERING THE INCOME OF INDIVIDUAL AS INCOME OF HUF, WHEN INVESTMENT IS MADE BY INDIVIDUA L? 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW WHETHER THE LD.CIT(A) IS JUSTIFIED IN CONSIDERING THAT THE INVE STMENT WAS MADE IN THE CAPACITY OF A DIRECTOR AND FOR THE USE OF BU SINESS PURPOSE 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW WHETHER THE LD.CIT(A) IS JUSTIFIED IS GIVING RELIEF BASED ON EX TRA EVIDENCES DURING APPELLATE PROCEEDINGS, WHICH WERE NOT PRODUC ED DURING THE ASSESSMENT PROCEEDINGS IN SPITE OF SUFFICIENT OPPOR TUNITIES. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW WHETHER THE LD.CIT(A) IS JUSTIFIED IN ADMITTING EXTRA EVIDENCES WITHOUT CALLING FOR REMAND REPORT ON THE SAME AS PER RULE 46A OF TH E INCOME TAX, RULES. 5. IT IS PRAYED THAT THE ORDER OF THE AO MAY BE RESTOR ED. 6. THE APPELLANT CRAVES LEAVES TO ADD, ALTER OR DELETE ANY GROUND(S) EITHER BEFORE OR IN THE COURSE OF HEARING OF THE AP PEAL. 2. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE AS SESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143( 3) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 20/12/2011. WHILE FRAMING THE ASSESSMENT, THE ASSESSING OFFICER (AO IN SHORT) MADE ADDITION OF RS.1,12,000/- ON ACC OUNT OF UNDISCLOSED INTEREST INCOME AND RS.82,69,000/- AS UNEXPLAINED I NVESTMENT IN IMMOVABLE PROPERTIES. THE ASSESSEE BEING AGGRIEVED BY THE ASSESSMENT ORDER, PREFERRED AN APPEAL BEFORE THE LD.CIT(A), WH O AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE ALLOWED THE APPEAL AND DIRECTED THE AO TO DELETE THE ADDITIONS. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), THE REVENUE IS IN APPEAL BEFORE US. ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 3 - 3. THE LD.SR.DR RELIED ON THE ORDER OF THE AO AND R EITERATED THE SUBMISSIONS AS WERE MADE IN THE STATEMENT OF FACTS. 3.1. ON THE CONTRARY, THE LD.SR.COUNSEL FOR THE ASS ESSEE SHRI S.N.SOPARAKAR SUBMITTED THAT ALL THE DETAILS AND EV IDENCES WERE FILED BEFORE THE AUTHORITIES BELOW AND THE LD.CIT(A) EXAM INED THE ISSUES IN RIGHT PERSPECTIVE AND RIGHTLY CAME TO THE CONCLUSIO N THAT THE ADDITION WAS NOT CALLED FOR. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE FIRST GROUND IS AGAINST DELETION OF ADDITION OF RS.1,12,000/-. THE LD.SR.COUNSEL FOR THE ASSESSEE HAS RELIED ON THE OR DER OF THE LD.CIT(A) AND REITERATED THE SUBMISSIONS AS WERE MADE IN THE WRIT TEN SUBMISSIONS PLACED ON RECORD (PAPER-BOOK). WE FIND THAT THE L D.CIT(A) HAS GIVEN A FINDING ON FACT BY OBSERVING AS UNDER:- 5.3. DECISION : I HAVE CAREFULLY CONSIDERED THE OBSERVATIONS OF THE AO IN THE ASSESSMENT ORDER AS WELL AS THE CO NTENTION RAISED BY THE AR OF THE APPELLANT IN THE WRITTEN SUBMISSIO N. THE AO ASSESSED THE INTEREST INCOME IN THE HANDS OF THE IN DIVIDUAL BECAUSE THE AMOUNT WAS CREDITED IN THE BANK A/C. ON THE OT HER HAND THE APPELLANT CONTENDED THAT THE INVESTMENT MADE AS A K ARTA OF HUF AND BY MISTAKE THE INTEREST AMOUNT WAS CREDITED IN THE INDIVIDUAL ACCOUNT OF THE APPELLANT. HOWEVER, THE SAID AMOUNT WAS TRANSFERRED TO THE HUF A/C. AND SUFFERED THE RIGOR OF TAXATION. IN ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 4 - CASE THE AMOUNT IS ASSESSED IN THE HAND OF THE APPE LLANT, IT WILL AMOUNT TO DOUBLE TAXATION. THE APPELLANT HAS ALSO RELIED ON THE DECISION OF THE HONBLE SC IN THE CASE OF KALU BABU LAL CHAND VS COMMISSIONER OF INCOME TAX (SC) (AIR 1289 1960 SCR (1) 320 (1959) RELEVANT TO THE APPELLANTS CASE. CONSIDERI NG THE FACTUAL MATRIX OF THE CASE, I AGREE THE APPELLANTS ARGUMEN T HAS FORCE. THE AMOUNT IN QUESTION HAS BEEN ASSESSED IN THE HAN DS OF THE HUF AND RIGHTLY SO BECAUSE THE EVIDENCES SHOWED THAT TH E BOND WAS PURCHASED BY HUF AND NOT THE INDIVIDUAL ASSESSEE. THEREFORE, THE AO IS DIRECTED TO DELETE THE ADDITION MADE IN THIS GROUND. ACCORDINGLY, THIS GROUND IS ALLOWED . 4.1. THE AFORESAID FINDING OF THE LD.CIT(A) HAS NOT BEEN CONTROVERTED BY THE REVENUE BY PLACING ANY CONTRARY-MATERIAL ON RECORD. THERE IS ALSO NOT IN DISPUTE THAT THE IMPUGNED DISALLOWANCE WAS O FFERED FOR TAX BY THE HUF. THEREFORE, WE DO NOT SEE ANY REASON TO INTERF ERE WITH THE ORDER OF THE LD.CIT(A), SAME IS HEREBY UPHELD. THUS, GROUN D NO.1 OF THE REVENUES APPEAL IS REJECTED. 5. GROUND NOD.2 IS AGAINST DELETION OF ADDITION OF RS.82,69,000/- MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT IN IMMOVA BLE PROPERTIES. THE LD.SR.DR REITERATED THE SUBMISSIONS AS WERE MAD E IN THE STATEMENT OF FACTS. 5.1. ON THE CONTRARY, THE LD.SR.COUNSEL FOR THE ASS ESSEE SHRI S.N.SOPARAKAR SUBMITTED THAT THE LD.CIT(A) IGNORED THE PROPOSAL OF AO THAT NO FURTHER APPEAL IS TO BE FILED. HE DREW OUR ATTENTION TOWARDS THE STATEMENT OF FACTS OF THE REVENUE. ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 5 - 5.2. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED T HE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE AO HAD MADE THE ADDITION ON THE BASIS THAT NO E VIDENCE WAS FURNISHED IN RESPECT OF INVESTMENT IN IMMOVABLE PR OPERTIES. HOWEVER, THE CONTENTION OF THE ASSESSEE WAS THAT THE INVESTM ENT WAS MADE IN THE CAPACITY OF AUTHORIZED REPRESENTATIVE, I.E. BEING D IRECTOR OF THE COMPANIES. THE LD.CIT(A) HAS GIVEN FINDING ON FACT IN HIS ORDER BY OBSERVING AS UNDER:- 6.3. DECISION :- I HAVE CAREFULLY CONSIDERED THE OBSERVATIONS OF THE AO IN THE ASSESSMENT ORDER AS W ELL AS THE CONTENTION RAISED BY THE AR OF THE APPELLANT IN THE WRITTEN SUBMISSION. THE AO OBSERVED, ON THE BASIS OF AIR I NFORMATION, THAT THE PROPERTY WAS PURCHASED BY THE APPELLANT AN D NOT SHOWN AS INVESTMENT IN HIS R/I. ACCORDINGLY, HE MADE ADDITI ONS IN THE HANDS OF THE APPELLANT. ON THE OTHER HAND THE APPELLANT CLAIMED THAT THE SAID PROPERTY WAS PURCHASED BY THE APPELLANT IN THE CAPACITY OF A DIRECTOR AND FOR THE USE OF THE COMPANY M/S.CHHEDA ELECTRICAL PRIVATE LIMITED & JAGDISH ELECTRONICS (I) PVT.LTD. TO PROVE THE POINT THE APPELLANT SUBMITTED COPY OF THE SALES DEE D FOR PURCHASE OF IMMOVABLE PROPERTY, POWER OF ATTORNEY TO JAGDISH CHHEDA AUTHORIZING TO PURCHASE PROPERTY, BANK STATEMENTS O F THE COMPANY SHOWING THE FUND FLOW FOR THE PURCHASE AND THE CERT IFICATE FROM THE QUALIFIED CA VERIFYING THAT THE PROPERTIES IN QUEST IONS HAVE BEEN REFLECTED IN THE BOOKS OF THOSE COMPANIES. I HAVE PERUSED THOSE EVIDENCES AND CONVINCED THAT THE PROPERTIES WERE PU RCHASED FOR AND ON BEHALF OF THE COMPANIES AND NOT FOR THE INDI VIDUAL USE. IN THIS CIRCUMSTANCES, IT IS UNTENABLE TO MAKE ADDITIO NS IN THE HAD OF THE APPELLANT AS UNDISCLOSED INVESTMENT. THE SOURC E OF FUNDS AND THE HOLDER OF THE PROPERTIES WAS WELL EXPLAINED BY THE APPELLANT. ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 6 - THEREFORE, THE AO IS DIRECTED TO DELETE THE ADDITIO N MADE. THIS GROUND IS ALLOWED . 5.3. THE AFORESAID FINDING OF THE LD.CIT(A) IS NOT CONTROVERTED BY THE REVENUE BY PLACING ANY CONTRARY-MATERIAL ON RECORD. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE AO WAS NOT JUSTIFIED IN MA KING THE ADDITION. HENCE, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF TH E LD.CIT(A), SAME IS HEREBY UPHELD AND GROUND RAISED IN THE REVENUES APPEAL IS DISMISSED. 6. APROPOS TO GROUND NOS.3 & 4 OF THE REVENUES AP PEAL, THE LD.SR.DR HAS NOT ADVANCED ANY ARGUMENT AND, THEREFORE, THE S AME ARE REJECTED AS SUCH. 7. GROUND NOS.5 & 6 ARE GENERAL IN NATURE WHICH REQ UIRE NO INDEPENDENT ADJUDICATION. 8. IN THE RESULT, REVENUES APPEAL STANDS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON FRIDAY, THE 04 TH DAY OF MARCH, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( PRAMOD KUMAR ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 04/ 03 /2016 0)..& , '.&../ T.C. NAIR, SR. PS ITA NO.1270/AHD /2012 ACIT VS. SHRI VIJAY JAGDISH CHHEDA ASST.YEAR 2009-10 - 7 - !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #' / THE RESPONDENT. 3. 123 4 / CONCERNED CIT 4. 4 ( ) / THE CIT(A)-VALSAD 5. 5'6 &23 , ) 23 , , 1 / DR, ITAT, AHMEDABAD 6. 689 :( / GUARD FILE. / BY ORDER, #5 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 24.2.16 (DICTATION-PAD 6+P AGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..2.3.16 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.4.3.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 4.3.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER